US arrest of Chinese executive looks like Deep State sabotage of Trump and heads should roll-Spengler…(Everyone knows Trump allows saboteurs to remain on his staff so why shouldn’t they make him look bad?)

[Bolton]: Well, you know, there are a lot of things that are pending in any given time. You don’t know exactly what’s going to happen in terms of a particular law enforcement action, that depends on a lot of other circumstances.”

National security adviser John Bolton: Well, I’d rather not get into the specifics of law enforcement matters but, but we’ve had enormous concern for years about … in this country about the practice of Chinese firms to use stolen American intellectual property to engage in forced technology transfers and to be used really as arms of the Chinese government’s objectives in terms of information technology in particular. So not respecting this particular arrest, but Huawei is one company we’ve been concerned about, there are others as well. I think this is going be a major subject of the negotiations that President Trump and President Xi Jinping agreed on in Buenos Aires.

[NPR]: This had been understood to involve Huawei ‘s dealings with Iran in some fashion. Are you saying that’s not correct?

[Bolton]: Well, I think the violations of the Iran sanctions are certainly of major concern to the Trump administration. It’s one of his signature policies and I think that applies on a global basis. But with respect to a number of Chinese companies,we saw what happened with ZTE some months agoand many other issues of concern like that. And I think, as I say, as the negotiations proceed I think we’re gonna see a lot about what Chinese companies have done to steal intellectual property, to hack into the computer systems, not just of the U.S. government, although they’ve done that, but into private companies as well.”

A number of my friends in the national security establishment cheered the arrest of Meng Wanzhou. Huawei is now the world’s largest telecommunications equipment manufacturer, and has positioned itself as market leader in 5G mobile broadband technology. 5G not only promises download speeds an order of magnitude faster than 4G LTE, but makes possible a vast number of new industrial controls (the so-called Internet of Things) that will define a great deal of technology for the next generation. I’m all for beating Huawei, but picking off individual executives isn’t going to put a bell on the dragon.

Huawei played rough and dirty for years, undercutting its competitors’ prices and grabbing market share. It’s an employee-owned company that doesn’t show its books to the public, but I presume that it had substantial government subsidies. Fifteen years ago Huawei was caught red-handed stealing CISCO’s computer code, bugs and all. Today, Huawei spends as much on R&D as Microsoft. It has thousands of European engineers working in its research centers in Europe, as well as an army of Chinese researchers. It’s dangerous not because it steals technology but because it develops its own technology.

If the U.S.-China trade war escalates–and Saturday’s arrest in Vancouver was an extreme form of escalation–the likeliest outcome is a global stock market crash and a world recession. The U.S. stock market signaled distress last week when the news emerged (and the market crash on Tuesday, prior to news reports of the arrest, probably occurred after word leaked out to a few major hedge funds). The world would be divided into U.S. and Chinese spheres of economic influence. The U.S. has enough pull to keep Huawei out of the Anglo-Saxon world and possibly Japan, but don’t expect the Western Europeans to play ball with us. Chinese broadband technology likely will dominate Eurasia from the South China Sea to the English Channel.

I support President Trump and I want him to succeed. China is a rising behemoth that now invests more than we do, graduates four times as many STEM bachelor’s degrees and twice as many STEM doctorates than we do, and wants to dominate the high-tech future. If we want to beat China, I argued in this space last week, we need to do exactly what we did to beat Russia in the Cold War: Use the Defense Department research budget in partnerhsip with U.S. industry to leapfrog China in a key set of technologies. It won’t be easy, as the distinguished engineer and mathematician Edward Dougherty warns in a response to my article. We will require an overhaul of our education system, argues Prof. Dougherty, who is distinguished professor of engineering at Texas A&M University.